In an effort to continue bringing good news the San Diego real estate market, I am very pleased to report that San Diego ranked as the 7th most searched real estate market by buyers and sellers online. This is a great accomplishment and proves the strength of the San Diego housing market. There is no denying that we are in one of the world's most desirable places to live and demand in San Diego continues to be strong compared to other parts of the country.
While many real estate markets in 2010 experienced extraordinary highs and lows in response to tax credits, low interest rates and price swings, consumer interest in some markets was consistently strong. Las Vegas and Los Angeles came in as the initial and second most searched markets every month in 2010, while Orlando, San Antonio and Miami vied as the third, fourth and fifth most searched cities respectively. Phoenix, San Diego, Austin, Tampa and Chicago, in that order, held the sixth through tenth positions as the most searched markets in 2010.
In early 2010, house sales and prices rose throughout the country quicker than they had for several years. This was largely in response towards the Federal home buyer tax credit for first-time and repeat buyers. Right after the Federal home buyer tax credit expired in the finish of April 2010, sales slowed throughout the nation in summer and fall 2010 even though mortgage rates remained low. List prices and actual sale prices continued to fluctuate in response to sales, foreclosure, along with other trends throughout 2010 in San Diego as in other markets.
Despite changing market conditions in 2010, the nations most searched destinations remained remarkably consistent, focusing on the sunshine states of California, Nevada, Florida, Texas and Arizona. Aside from the sunshine, San Diego real estate prices enjoys the added benefit of having a number of natural geographical barriers that keep create a natural limit to our supply. To the east we have...
Pending home sales rose again in November 2010, with the trend over the past five months indicating a gradual recovery into 2011, according to the National Association of REALTORS. The Pending Home Sales Index, rose 3.5% based on contracts signed in November. This is a great forward looking indicator because a large percentage of those homes will close escrow in the coming months. In fact, it really is a lot better of an indicator of the economy's future direction than actual homes sales. It seems like San Diego home buyers that are taking advantage of the currently advantageous conditions are going to be very happy with their decision.
Lawrence Yun, NAR chief economist, said historically high housing affordability is boosting sales activity. In addition to exceptional affordability conditions, steady improvements in the economy are helping bring buyers into the market, he said.
If we add 2 million jobs as expected in 2011, and mortgage rates rise only moderately, we should see existing-home sales rise to a higher, sustainable volume, Yun said. The key is going to be to make sure that mortgage rates only rise moderatly.
Credit remains tight, but even the slightest easy in lending, which would really only bring it closer to normal from its currently overly stringent state, would give the market a huge boost. In my opinion it is likely we will see this happen because it is a natural byproduct of our competitive free market system.
The 30-year fixed-rate mortgage is forecast to rise gradually to 5.3% around the end of 2011; at the same time, unemployment should drop to 9.2%.
All the indicator trends are pointing to a gradual housing recovery, Yun said. Home price prospects will vary depending largely upon local job market conditions. The national median home price, however, is expected to remain stable even with the continuing flow of distressed properties coming to the market, as long as there is a steady demand of financially healthy...
Buying a condo comes with a few unique points of due diligence that you must perform. If you do not know the right questions to ask you may be in for an unpleasant surprise during the course of your transaction or later down the road should you need to sell it. Hopefully you are working with a real estate agent that advices you to do the following:
- Check the owner occupancy rate of the condo complex. This is going to have a direct impact on you in multiple ways. The first will be when you are trying to get a loan. Most lenders will not lend on a condo complex with an owner occupancy rate under 50%. This means more than 50% of the people living in the complex are renters. Lenders view this as being a riskier investment and they are hesitant to lend. Or they will lend but they will require higher down payment amounts, which you may or may not be able to meet. Now let's assume that you are able to secure financing through a higher down payment amount or that you are a cash buyer and were able to avoid the issue all together. Eventually you will become a seller and this question of owner occupancy rate will come back into play. In other words, the people looking to buy from you will face the same issue, which will make it harder to sell because people working with a limited down payment amount will not be candidates for your home. This means that there will be less potential buyers, which puts downward pressure on price and also makes it more difficult to sell quickly should you ever have to. Make sure your real estate agent researches the owner occupancy rate of any condo you are interested in. This doesn't mean you shouldn't buy any condo with a lower owner occupancy rate, but it does mean that you should factor this into your analysis.
- Ask if there is any litigation in the condo complex. This has especially been an on going issue for many downtown San Diego condos for sale. Litigation in a condo complex is one of the most devastating...
In an effort to bring more good news to San Diego property, and help bring others off the fence, I want to si-si-highlight a new study recently released by Fannie Mae. It finds that the majority of Americans, including those that currently own and those who are renting, do indeed aspire to be home owners.
However, recent trends such as people marrying at a later age and having less children is allowing people to feel comfortable with renting for a longer period of time. It also causes people to have fewer home purchases over their lifetime. Nevertheless, the value of homeownership is not lost on Americans.
The Fannie Mae 2010 Own-Rent Analysis is based on extensive primary research with property owners and renters. The study aims to explores the aspects influencing consumers’ decisions to buy or rent a home.According to the study, 51% of current owners and renters say that the housing crisis has not affected their overall willingness to purchase a home. Considering what happened here locally in San Diego and across the country, that is very encouraging. Nevertheless, even though homeownership aspirations are high for the long-term, Americans have near-term doubts about purchasing. Overall, according to Fannie Mae’s National Housing Survey third quarter results, 33% one-third of American would be more likely to rent their next home than acquire, up from 30% in January 2010. Among renters, 59% said they will rent again when they make their next move, compared to 54% in January 2010.
The Fannie Mae National Housing Survey is an ongoing investigation that surveys Americans’ attitudes about housing on a monthly basis. The most recent installment of this survey, released in November, showed that aspirations toward homeownership remain strong-well in excess of current homeownership rates-but decisions to buy are tempered by current consumers’ cautious attitudes toward investing in real estate within the present economic environment. However, it is worth...
Here is a piece of good news for everyone. San Diego loan servicers taking part in the Home Affordable Foreclosure Alternatives Program (HAFA) are going to soon be held to stricter timelines for approving or rejecting short sales. Furthermore, they will also be given more freedom to pay off second-lien holders.
This comes as a great relief to anyone that has experienced trying to buy a San Diego short sale only to find out that the process can take an indefinite amount of time.
To illustrate the point, I represent a buyer who is closing escrow today on a condo in Downtown San Diego (January 11, 2011) who made an offer and opened escrow back in May of 2010. The property has actually been in and out of escrow for two years as a result of buyers less patient than mine abandoning the deal out of frustration. That not only led to an excurciatingly long process for everyone involved but the bank also ended up netting less money as the price of the condo fell further over the two year period. Everyone was a loser.
Now with the new rules, loan officers will have 30 days to provide distressed home owners with a short-sale agreement that includes the list price or acceptable sales agreement with hopes of helping people who fail to qualify for other government loan modification programs. Under the new policy loan servicers will have 30 days to accept or reject the transaction. This is a dramatic improvement to the way it has been up to now, which seemingly allows the process to drag on forever. The result should be improved confidence, both for those buying and selling San Diego short sales. Many distressed homeowners in today's market have actually opted not to pursue a short sale, even when it was in their best interest, due to the high level of uncertainty, both in result and time.
The new policies go into effect February 1, yet do not apply to mortgages owned or guaranteed by Fannie Mae or Freddie Mac, or for FHA loans.
The present San Diego real estate market provides several distinctive opportunities for first-time home buyers. From low interest rates to foreclosed properties and short sales, the current economic environment is creating a fresh wave of San Diego home buyers that may not have previously considered the possibility.
Many first-time home buyers may not be aware of the numerous elements involved in the home-buying process. Being a Member of the Top 5 in Real Estate Network®, I am aware of the likely pitfalls that may possibly trip up new potential buyers along the way. Here are 5 si-highlight--primary recommendations for you when buying a new home.
1. Investigation: Do your homework before you buy and be sure to review the closing statistics of similar homes in the neighborhoods you are considering. Search the internet, including the San Diego MLS and social media internet sites, in order to get as much critical information as possible concerning residences that appeal to you and the communities in which they're found. Provide this kind of information to your real estate agent who can interpret it and put it within the appropriate context for your goals.
2. Credit worthiness: Due to the current constrained lending environment, it’s critical to clean up your credit standing before applying for a mortgage loan. A low credit score may not just affect your rates, but may prevent you from getting a mortgage altogether.
3. Get pre-approved: Getting your bank loan pre-approved provides you with additional influence over home sellers. Not only will you understand what the purchase parameters are, but you may be able to negotiate an improved purchase price because you can close with more certainty and more swiftly. Make sure that your real estate agent negotiates a solid financing contingency. In today's environment financing is the biggest challenge you will...